Correlation Between MFS Municipal and Blackrock Muniholdings
Can any of the company-specific risk be diversified away by investing in both MFS Municipal and Blackrock Muniholdings at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining MFS Municipal and Blackrock Muniholdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MFS Municipal Income and Blackrock Muniholdings Quality, you can compare the effects of market volatilities on MFS Municipal and Blackrock Muniholdings and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in MFS Municipal with a short position of Blackrock Muniholdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of MFS Municipal and Blackrock Muniholdings.
Diversification Opportunities for MFS Municipal and Blackrock Muniholdings
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between MFS and Blackrock is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding MFS Municipal Income and Blackrock Muniholdings Quality in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blackrock Muniholdings and MFS Municipal is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on MFS Municipal Income are associated (or correlated) with Blackrock Muniholdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blackrock Muniholdings has no effect on the direction of MFS Municipal i.e., MFS Municipal and Blackrock Muniholdings go up and down completely randomly.
Pair Corralation between MFS Municipal and Blackrock Muniholdings
Considering the 90-day investment horizon MFS Municipal is expected to generate 11.46 times less return on investment than Blackrock Muniholdings. In addition to that, MFS Municipal is 1.07 times more volatile than Blackrock Muniholdings Quality. It trades about 0.02 of its total potential returns per unit of risk. Blackrock Muniholdings Quality is currently generating about 0.2 per unit of volatility. If you would invest 1,030 in Blackrock Muniholdings Quality on August 24, 2024 and sell it today you would earn a total of 26.00 from holding Blackrock Muniholdings Quality or generate 2.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
MFS Municipal Income vs. Blackrock Muniholdings Quality
Performance |
| Timeline |
| MFS Municipal Income |
| Blackrock Muniholdings |
MFS Municipal and Blackrock Muniholdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MFS Municipal and Blackrock Muniholdings
The main advantage of trading using opposite MFS Municipal and Blackrock Muniholdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MFS Municipal position performs unexpectedly, Blackrock Muniholdings can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Blackrock Muniholdings will offset losses from the drop in Blackrock Muniholdings' long position.| MFS Municipal vs. Invesco High Income | MFS Municipal vs. Blackrock Muniholdings Ny | MFS Municipal vs. MFS Investment Grade | MFS Municipal vs. Federated Premier Municipal |
| Blackrock Muniholdings vs. MFS Investment Grade | Blackrock Muniholdings vs. Eaton Vance National | Blackrock Muniholdings vs. Blackrock Muniyield Quality | Blackrock Muniholdings vs. Munivest Fund |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
Other Complementary Tools
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments |